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ACB-CLIN-CHEM-GEN  March 2014

ACB-CLIN-CHEM-GEN March 2014

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Subject:

I’m confused - follow-up to the emails.

From:

"Richard Jones [Pathology]" <[log in to unmask]>

Reply-To:

Richard Jones [Pathology]

Date:

Wed, 5 Mar 2014 11:04:42 +0000

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text/plain

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text/plain (25 lines)

Thank you to everyone who replied to my initial email. There were a number of really interesting points made which I’ll try to summarise:

Firstly on the cost. Thanks to Mike Collins researching out from Sigma the true cost of the enzymes used in glucose and creatinine assays. Nice to know he still has a catalogue.
Though quite rightly the cost of the creatinine enzyme is threefold that of the glucose enzyme it cannot alone explain the excess cost of the enzymic assays. If you estimate that the total cost of the assay is made up of a number of components including transport, packaging, marketing and other reagents  it is unlikely that the cost of the enzymes amounts to more than 1% of the total price hence even if the enzyme were three times as expensive it would have a marginal, possibly 0.3% effect on the total cost. Thus we can discount reagent cost as the major driver of the published price.

Second procurement. Many people commented on the difficulties presented by fragmented procurement. It is clear that where new contracts are laid for this essay the companies are taking an opportunity to load the contracts with new prices. Similarly it was pointed out that even within a managed service contract these costs will be buried but will be significant. There was also some very interesting comments around the inability of large health systems whether in socialist, communist or free market economies to manage the market in their favour. Top-down centralised procurement seems to lead to the same outcomes as the raw market with a balance in favour of the supplier. However given the purchasing power of the NHS collectively and the common interest in minimising local costs and achieve significant patient benefit it should surely be possible for labs to coordinate their purchasing such that optimal deals can be arranged. Perhaps just exposing the level of price variance being offered between laboratories might force the companies to be more even handed and accept realistic prices for the reagents. It was also pointed out that were patients to understand the economics of this issue including the safety issues, the inconvenience costs borne by the health system that it would be intolerable for companies to continue to charge such high prices and thereby denying patients high quality care. I have no doubt that companies are not necessarily acting unethically but the nature of the economic system dictates that they don’t necessarily operate always in the public interest.

If there are any company representatives or executives lurking on this list you may well wish to make note of these comments and make adjustments to your pricing policies. There ise a great opportunity to demonstrate how the industry can improve health care were a position to be taken to swap out the redundant dangerous assays for the up-to-date ones across the UK. I know that the industry bodies like BIVDA would welcome such a change to demonstrate the true worth of the diagnostics industry but ultimately it demands change in company policy and in locally negotiated contracts.
The ACB has a proud history of working closely with industry to deliver top quality NHS services. Solving this conundrum would once again show what can be achieved through a partnership of strong science, sensible evidence-based test selection and industrial support.

 I would welcome any further comments on this issue.

Rick Jones
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